Luis Alberto Mireles d/b/a ExxxTreme Drive Thru, DAB TB9854 (2025)

INITIAL DECISION

Found:

1. Respondent violated 21 U.S.C. § 331, specifically section 906(d)(5) of the Federal Food, Drug and Cosmetic Act (Act) (21 U.S.C. § 387f(d)(5)), as charged in the complaint; and
2. Respondent violated 21 U.S.C. § 331, 21 C.F.R. 1140.14(b)(2)(i), as charged in the prior complaint; and

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3. Respondent committed seven repeated violations in a 36-month period as set forth hereinabove; and
4. Respondent is hereby assessed a 30-day No-Tobacco-Sale Order (NTSO).

Glossary:

I.  JURISDICTION

      I have jurisdiction to hear this case pursuant to my appointment by the Secretary of Health and Human Services and my authority under the Administrative Procedure Act (5 U.S.C. §§ 554-556), 5 U.S.C.A. § 3106, 21 U.S.C. § 333(f)(5), 5 C.F.R. §§ 930.201 et seq. and 21 C.F.R. Part 17.2

II.  PROCEDURAL BACKGROUND

      The Center for Tobacco Products (CTP/Complainant) filed a Complaint on July 30, 2024, against Luis Alberto Mireles d/b/a ExxxTreme Drive Thru (Respondent or

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ExxxTreme Drive Thru), located at 3020 Tom Gill Road, Penitas, Texas 78576.  Civil Remedies Division (CRD) Docket (Dkt.) Entry No. 1 (Complaint).  The Complaint alleges that FDA documented seven repeated violations within a 36- month period.  Complaint at 2.

      Respondent was served with process on July 29, 2024, by United Parcel Service.  CRD Dkt. Entry No. 1b (Proof of Service).  On August 28, 2024, Respondent filed a timely answer.  CRD Dkt. Entry No. 5 (Answer).

      On September 18, 2024, I issued a Pre-Hearing Order (PHO) establishing what the parties must do to present evidence and arguments in this case.  CRD Dkt. Entry No. 6 (PHO).  The PHO directed the parties to file their pre-hearing exchanges by December 17, 2024.  PHO at 3.  On December 17, 2024, CTP filed its pre-hearing exchange consisting of an informal brief, a list of proposed witnesses and exhibits, and 15 proposed exhibits.  CRD Dkt. Entry Nos. 7, 7a‑7p.  CTP included the written testimony of one proposed witness: Inspector Maria I. Martinez, FDA-commissioned officer with the state of Texas (CTP Ex. 7).  Respondent did not file a pre-hearing exchange as directed.

      On April 4, 2025, CTP filed a Motion to Extend Deadlines, stating that "[o]n April 1, 2025, FDA experienced a significant reduction in force (RIF), including in FDA's Center for Tobacco Product's [CTP's] Office of Compliance and Enforcement, the office that supports all tobacco-related administrative cases" and Complainant "is still evaluating the impact the RIF may have on CTP's immediate operations . . . [and] is requesting a 30-calendar day extension of all pending deadlines in this matter."  CRD

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Dkt. Entry No. 13.  On April 7, 2025, I prematurely issued an Order Scheduling Telephone hearing for April 29, 2025.  CRD Dkt. Entry No. 14.  On April 10, 2025, I issued an order cancelling the hearing and instructed the parties to provide a Joint Status Report on May 12, 2025 indicating whether they wish to reschedule a hearing in this case.  CRD Dkt. Entry No. 15.  On May 12, 2025, CTP filed a Status Report advising of its desire to have the previously scheduled hearing be rescheduled.  CRD Dkt. Entry No. 16.  CTP also stated that it was unable to reach Respondent to discuss the filing of the Joint Status Report.  Id.

      On June 5, 2025, I issued an order rescheduling a hearing for July 18, 2025.  CRD Dkt. Entry No. 19.  The Order directed the parties to file any motions to exclude or objections to the other party's proposed exhibits, and to indicate which witnesses, if any, it wishes to cross-examine, at least 15 days prior to the hearing date.  Id.  The Order also advised that if neither party sought to cross-examine the opposing party's witness, I would cancel the hearing and issue a written decision on the record.  Id.  On July 8, 2025, CTP filed a Motion to Waive Hearing and Request a Decision on the Written Record and to Admit its Proposed Exhibits into Evidence.  CRD Dkt. Entry No. 20.

      On July 15, 2025, I issued an Order Canceling Hearing and Scheduling Briefing.  CRD Dkt. Entry No. 21.  In the Order, I cancelled the hearing and admitted CTP's exhibits into evidence.  Id. at 2.  Parties were given 30 days from the date of the Order Canceling Hearing to file final written briefs on the merits of the case.  Id.

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      Neither party filed a final brief, therefore, the administrative record is now closed and ready for a decision based on the written record.  21 C.F.R. § 17.45(c).

III.  BURDEN OF PROOF

      As the petitioning party, CTP, has the burden to prove, by a preponderance of the evidence, that Respondent is liable and that the proffered penalty is appropriate.  21 C.F.R. § 17.33.

IV.  LAW

      21 U.S.C. § 331, specifically section 906(d)(5) of the Act, and 21 C.F.R. § 1140.14(b)(2)(i).

V.  ISSUE

      Did Respondent repeatedly violate 21 U.S.C. § 331, specifically section 906(d)(5) of the Act, seven or more times within a 36-month period; and if so, is a 30-day NTSO appropriate?

VI.  ALLEGATIONS

A. Complainant's Recitation of the Facts

      In its Complaint, CTP alleged that Respondent owns an establishment, doing business under the name ExxxTreme Drive Thru, located at 3020 Tom Gill Road, Penitas, Texas 78576.  Complaint ¶7.  Respondent's establishment received tobacco products in interstate commerce and held them for sale after shipment in interstate commerce.

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      During an inspection of ExxxTreme Drive Thru conducted on February 10, 2024, at 3020 Tom Gill Road, Penitas, Texas 78576, an FDA-commissioned inspector documented the following violations:

1. Selling tobacco products to a person under 21 years of age, in violation of section 906(d)(5) of the Act.  Specifically, a person younger than 21 years of age was able to purchase a package of two Swisher Sweets Classic Grape cigars at Respondent's establishment on February 10, 2024, at approximately 4:03 PM; and
2. Failing to verify the age of a person purchasing tobacco products by means of photographic identification containing the bearer's date of birth, as required by 21 C.F.R. § 1140.14(b)(2)(i).  Specifically, the underage purchaser's identification was not verified before the sale, as detailed above, on February 10, 2024, at approximately 4:03 PM.

B. Respondent's Recitation of the Facts

      In its Answer, Respondent admitted all of the allegations and stated that "[t]he wrongful acts were done by properly trained employees whom took it upon themselves to not follow proper state of Texas sale of tobacco laws without my knowledge and I took proper actions in firing the individuals."  Answer at 2.  Respondent further asserted that the NTSO CTP requests is inappropriate because "[t]he wrongful acts were not my doing and I have taken care of the problem by firing the individuals and now arising a new process by having employees take classes and courses on tobacco laws . . . . I have taken upon myself to post a lot more signs for constant reminders on tobacco laws."  Id.

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VII.  PRIOR VIOLATIONS

      On October 12, 2022, CTP initiated the first civil money penalty action, CRD Docket Number T-23-70, FDA Docket Number FDA-2022-H-2493, against Respondent for three violations of 21 C.F.R. pt. 1140.  CTP alleged those violations to have occurred at Respondent's business establishment, located at 3020 Tom Gill Road, Penitas, Texas 78576, on August 14, 2021, and August 7, 2022.

      The previous action concluded when Respondent admitted the allegations contained in the Complaint issued by CTP and paid the agreed upon penalty.  Further, "Respondent expressly waived its right to contest such violations in subsequent actions."

      On March 9, 2023, CTP initiated the second civil money penalty action, CRD Docket Number T-23-1307, FDA Docket Number FDA-2023-H-0835, against Respondent for two violations of 21 C.F.R. pt. 1140.  CTP alleged these violations to have occurred at Respondent's business establishment, 3020 Tom Gill Road, Penitas, Texas 78576, on December 4, 2022.

      The previous action concluded when Respondent admitted the allegations contained in the Complaint issued by CTP and paid the agreed upon penalty.  Further, "Respondent expressly waived its right to contest such violations in subsequent actions."

      On September 15, 2023, CTP initiated the third civil money penalty action, CRD Docket Number T-23-3733, FDA Docket Number FDA-2023-H-3927, against Respondent for two violations of 21 C.F.R. pt. 1140.  CTP alleged these violations to

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have occurred at Respondent's business establishment, 3020 Tom Gill Road, Penitas, Texas 78576, on June 17, 2023.  The previous action concluded when an Initial Decision and Default Judgment was entered by an Administrative Law Judge, "finding that all of the violations alleged in the Complaint occurred."

      I find and conclude Respondent committed seven repeated violations of 21 U.S.C. § 331, specifically section 906(d)(5) of the Act and 21 C.F.R. § 1140.14(b)(2)(i) within a 36-month period as set forth in the complaint.

VIII.  FAMILY SMOKING PREVENTION AND TOBACCO CONTROL ACT

      The "relevant statute" in this case is actually a combination of statutes and regulations:  The Family Smoking Prevention and Tobacco Control Act, Pub. L. No. 111‑31, 123 Stat. 1776 (2009) (TCA), amended the Food, Drug, and Cosmetic Act (21 U.S.C.A. Chap. 9) (FDCA) and created a new subchapter of that Act that dealt exclusively with tobacco products, (21 U.S.C. §§ 387-387u), and it also modified other parts of the FDCA explicitly to include tobacco products among the regulated products whose misbranding can give rise to civil, and in some cases criminal, liability.  The 2009 amendments to the FDCA contained within the TCA also charged the Secretary of Health and Human Services with, among other things, creating regulations to govern tobacco sales.  The Secretary's regulations on tobacco products appear in Part 1140 of Title 21, Code of Federal Regulations.

      Under the FDCA, "[a] tobacco product shall be deemed to be misbranded if, in the case of any tobacco product sold or offered for sale in any State, it is sold or distributed

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in violation of regulations prescribed under section 387f(d)."  21 U.S.C. § 387c(a)(7)(B) (2012).  Section 387a‑1 directed FDA to re-issue, with some modifications, regulations previously passed in 1996.  21 U.S.C. § 387 a-1(a) (2012).  These regulations were passed pursuant to section 387f(d), which authorizes FDA to promulgate regulations on the sale and distribution of tobacco products; 75 Fed. Reg. 13,225 (Mar. 19, 2010), codified at 21 C.F.R. Part 1140 (2015); 21 U.S.C. § 387f(d)(1) (2012).  Accordingly, 21 C.F.R. § 1140.1(b) provides that "failure to comply with any applicable provision in this part in the sale, distribution, and use of cigarettes and smokeless tobacco renders the product misbranded under the act."

      Under 21 U.S.C. § 331(k), "[t]he alteration, mutilation, destruction, obliteration, or removal of the whole or any part of the labeling of, or the doing of any other act with respect to, a food, drug, device, tobacco product, or cosmetic, if such act is done while such article is held for sale (whether or not the first sale) after shipment in interstate commerce and results in such article being adulterated or misbranded" is a prohibited act under 21 U.S.C. § 331.  Thus, when a retailer such as Respondent misbrands a tobacco product by violating a requirement of 21 C.F.R. Part 1140, that misbranding in turn violates the FDCA, specifically 21 U.S.C. § 331(k).  FDA may seek a civil money penalty from "any person who violates a requirement of this chapter which relates to tobacco products."  21 U.S.C. § 333(f)(9)(A) (2012).  Penalties are set by 21 U.S.C. § 333 note and 21 C.F.R. § 17.2.  Under current FDA policy, the first time FDA finds violations of 21 C.F.R. Part 1140 at an establishment, FDA only counts one violation regardless of the number of specific regulatory requirements that were actually violated,

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but if FDA finds violations on subsequent occasions, it will count violations of specific regulatory requirements individually in computing any civil money penalty sought.  This policy is set forth in detail, with examples to illustrate, at U.S. Food & Drug Admin., Guidance for Industry and FDA Staff, Civil Money Penalties and No-Tobacco-Sale Orders for Tobacco Retailers, Responses to Frequently Asked Questions (Revised) (2016), available at http://www.fda.gov/downloads/TobaccoProducts/Labeling/RulesRegulationsGuidance/UCM447310.pdf [hereinafter Guidance for Industry], at 13-14.  So, for instance, if a retailer sells a tobacco product on a particular occasion to an underage purchaser without checking for photographic identification, in violation of section 906(d)(5) of the Act, and subpart B of part 1140 of title 21, Code of Federal Regulations, this will count as two separate violations for purposes of computing the civil money penalty, unless it is the first time violations were observed at that particular establishment.  This policy of counting violations has been determined by the HHS Departmental Appeals Board to be consistent with the language of the FDCA and its implementing regulations, see Orton Motor Co. d/b/a Orton's Bagley v. HHS, 884 F.3d 1205 (D.C. Cir. 2018).

IX.  LIABILITY

      When a retailer such as Respondent is found to have "misbranded" a tobacco product in interstate commerce, it can be liable to pay a CMP or have an NTSO imposed against it. 21 U.S.C. §§ 331, 333.

      Respondent concedes that the allegations as set forth in the complaint are true. I find and conclude that the evidentiary facts, by a preponderance of the evidence standard,

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support a finding that Respondent repeatedly violated 21 U.S.C. § 331, specifically section 906(d)(5) of the Act, in that a person younger than 21 years of age was able to purchase cigarettes or smokeless tobacco on August 14, 2021, August 7, 2022, December 4, 2022, and June 17, 2023.

      I find and conclude that the evidentiary facts, by a preponderance of the evidence standard, support a finding that Respondent repeatedly violated 21 U.S.C. § 331, specifically 21 C.F.R. § 1140.14(b)(2)(i), on August 7, 2022, December 4, 2022, and June 17, 2023, in that Respondent also repeatedly violated the requirement that retailers verify, by means of photo identification containing a purchaser's date of birth, that no cigarette or smokeless tobacco purchasers are younger than 21 years of age.

X.  PENALTY

      There being liability under the relevant statute, I must now determine the amount of penalty to impose.

      Pursuant to 21 U.S.C. § 333(f)(8), (9)(A), an NTSO may be imposed against Respondent for "repeated violations" of the regulations promulgated under section 906(d) of the Act.  "Repeated violation" means "at least 5 violations of particular requirements over a 36-month period at a particular retail outlet."  TCA § 103(q)(1)(A), 123 Stat. at 1838.  The statute does not establish specific periods for NTSOs, but it does contemplate NTSOs of an indefinite duration.  21 U.S.C. § 333(f)(5)(B).  The maximum period of time for the first NTSO received by a retailer is 30 consecutive calendar days. See Pub. L. 111–31, div. A, Title I, § 103(q)(1)(A), June 22, 2009, 123 Stat. 1838, 1839; U.S. Food & Drug Admin., Civil Money Penalties & No-Tobacco-Sale Orders For Tobacco Retailers:

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Guidance for Industry, 5-6 (Dec. 2016), available at http://www.fda.gov/downloads/TobaccoProducts/Labeling/RulesRegulationsGuidance/UCM252955.pdf (last updated Dec. 15, 2016); U.S. Food & Drug Admin., Determination of the Period Covered by a No-Tobacco-Sale Order & Compliance with Order, 3-4 (Aug. 2015), available at https://www.fda.gov/downloads/TobaccoProducts/Labeling/RulesRegulationsGuidance/UCM460155.pdf (last updated August 2015).

      As discussed, I found that CTP met its burden by a preponderance of the evidence and concluded that Respondent committed seven repeated violations of the Act and its implementing regulations within a 36-month period.  CTP asserts that a 30-day NTSO is appropriate for Respondent's repeated violations.

      In determining the duration of an NTSO, the Secretary must consider "the nature, circumstances, extent, and gravity of the violation or violations and, with respect to the violator, ability to pay, effect on ability to continue to do business, any history of prior such violations, the degree of culpability, and such other matters as justice may require." 21 U.S.C. § 333(f)(5)(B).

A. The Nature, Circumstances, Extent, and Gravity of the Violation

      I have found that Respondent specifically committed four repeated violations of selling regulated tobacco products underaged purchasers, and three repeated violations for failure to verify photographic identification of the purchasers, totaling seven repeated violations of the tobacco regulations within a 36-month period. The repeated inability of Respondent to comply with federal tobacco regulations is serious in nature and the

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penalty should be set accordingly.

B. Respondent's Ability to Pay and Effect on Ability to Continue to do Business

      Respondent has offered no evidence or argument regarding the effect of a 30-day NTSO on its ability to continue to do business.  If Respondent wished for me to consider its ability to continue to do business as factors to reduce the length of the NTSO, then the burden was on it to argue and provide evidence of the same.  Therefore, I conclude that the NTSO will not have a substantial effect on Respondent's ability to do business.

C. History of Prior Violations

      This is the fourth administrative action brought against Respondent for violations of the Act and its implementing regulations.  Respondent sold regulated tobacco products to persons younger than 21 years of age on August 14, 2021, August 7, 2022, December 4, 2022, and June 17, 2023.  On August 7, 2022, December 4, 2022, and June 17, 2023, Respondent also failed to verify, through photographic identification the age of the purchasers.  Between August 14, 2021, and June 17, 2023, Respondent violated the applicable regulations seven times.

      Respondent's actions demonstrate that it is either unable or unwilling to comply with the federal tobacco regulations and calls for a severe penalty.  It is evident that multiple CMP actions have not deterred Respondent from continuing to sell tobacco products in violation of law.  Accordingly, something other than a CMP plainly is needed here.

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D. Degree of Culpability

      Respondent asserts that it had properly trained its employees to comply with the law and concludes that the unlawful sales were simply outside its ability to control. Answer at 1.  However, Respondent bears the responsibility for assuring that its employees are acting within the scope of their employment to comply with federal law. The sale of tobacco products is clearly within the scope of employment for Respondent's staff.  Respondent may have implemented policies against illegal sales, but Respondent is tasked to ensure that its policies are enforced and effective to prevent such violations of law.  I find Respondent fully culpable for its violations.

E. Other Matters as Justice may Require

      Mitigation is an affirmative defense for which Respondent bears the burden of proof.  Respondent must prove any affirmative defenses and any mitigating factors by a preponderance of the evidence.  21 C.F.R. § 17.33(c).  Respondent asserts that it has taken measures to prevent sales to underage purchasers by having employees take classes and courses on tobacco laws and posting more signs for constant reminders on tobacco laws.  Answer at 1-2.  While Respondent has allegedly implemented these measures, it does not present any evidence of these measures actually being taken.  Therefore, Respondent has not established any mitigating factors which support a reduction in the NTSO period.

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F. Penalty

      For these reasons, I find that imposing a 30-day NTSO is appropriate to deter Respondent from continuing to violate federal law, but enable Respondent an opportunity to conduct its business in compliance with the law.  I warn Respondent that any future noncompliance will surely demonstrate that more drastic measures are necessary to protect the public from Respondent's business practices.

XI.  CONCLUSION

      Respondent committed seven repeated violations in a 36-month period and an NTSO for a period of 30 consecutive calendar days is appropriate.

      WHEREFORE, evidence having read and considered it be and is hereby ORDERED as follows:

1. I find Respondent has been served with process herein and is subject to this forum.
2. I find and conclude that the evidentiary facts, by a preponderance of the evidence standard, support a finding Respondent violated 21 U.S.C. § 331, specifically section 906(d)(5) of the Act on August 14, 2021, August 7, 2022, December 4, 2022, June 17, 2023, and February 10, 2024 .
3. I find and conclude that the evidentiary facts, by a preponderance of the evidence standard, support a finding Respondent violated 21 U.S.C. § 331, specifically 21 C.F.R. § 1140.14(b)(2)(i), on August 7, 2022, December 4, 2022, June 17, 2023, and February 10, 2024.
4. I find and conclude Respondent committed seven repeated violations of the applicable regulations within a 36-month period.
5. I find and conclude that a 30-day NTSO is appropriate.
6. I assess an NTSO against Respondent for a period of 30 consecutive days.

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